NADL - North Atlantic Drilling Ltd. reports second quarter 2015 results

Highlights from the second quarter

• North Atlantic Drilling generated second quarter 2015 EBITDA* of $119.3 million
• North Atlantic Drilling reports second quarter 2015 net income of $44.2 million and earnings per share of $0.17

Subsequent events

• North Atlantic Drilling secured a contract extension for the semi-submersible rig West Phoenix with Total E&P UK Limited, commencing mid-March 2016 and securing work for the unit through the end of August 2016. The total revenue potential for the contract extension is approximately $62 million.

*  EBITDA is defined as 'Earnings Before Interest, Tax, Depreciation and Amortization' and has been calculated by taking operating profit plus depreciation and amortization.

Financial highlights

 

Second quarter 2015 results

Consolidated revenues for the second quarter 2015 were $210.7 million compared to $192.0 million for the first quarter. The primary reason for the increase is the West Phoenix having significantly less downtime in Q2 compared to Q1, due to BOP repairs.

Operating income for the second quarter was $64.5 million, an increase of $27.6 million compared to the first quarter operating income of $36.9 million. The increase is primarily due to the West Phoenix as stated above, combined with lower operating costs as the West Navigator is now off contract and stacked.

Net financial items for the second quarter of 2015 amounted to a loss of $20.5 million. The loss included $25.1 million in interest expenses, gain on financial derivatives of $8.8 million, and foreign exchange loss of $3.4 million mainly related to the NOK1,500 million bond loan. The first quarter of 2015 incurred a net financial loss of $45.9 million, including interest expenses of $24.6 million, loss on financial derivatives of $34.3 million, and gain on foreign exchange of $14.4 million mainly related to the NOK1,500 million bond loan.

Income taxes for the second quarter was a  $0.2 million benefit, compared to a $2.3 million expense in the first quarter. The change was primarily due to a net tax benefit recognized during the quarter in respect of return-to-provision ("RTP") adjustments.

Net income for the second quarter was $44.2 million resulting in a basic earnings per share of $0.17, compared to net loss of $11.3 million for the first quarter.

The Company reports operating revenues of $402.7 million, operating income of $101.4 million and a net income of $32.9 million for the six months ended June 30, 2015. This compares to operating revenues of $616.3 million, operating income of $176.0 million and a net income of $79.9 million for the six months ended June 30, 2014.